The monthly Dow shows we are experiencing the lowest volume for the last 12 years. This is not a sign of good health so we need to keep the finger on the pulse to see how we finish the month and begin the next.
There are a number of factors I referred to that converge this year. The biggest thing to watch for in a presidential year is market manipulation and it would be against history to have a crash this year. However we face a range of unprecedented problems that can throw the best laid plans out the window and I think either war, default or natural disaster likely to derail us. There is a tendency immediately before a fast crash for a period of optimism to push the market up and then whip it down so yes 1500 is possible... just keep your finger on the trigger and expect a complex move that leaves most bears on the sidelines if a crash happens.
While we came close to a sell several times there has not been a sell signal on the daily as of yet. The Dow broke the prior high and got the round of applause for hitting 13,000, but there is another side to the gloss on this story. As I posted earlier, fuel consumption hit severe lows and the Transports were looking like making a wedge break down, and this indeed happened. All the goods the Dow companies sell has to be transported and if gas consumption drops and then the Transports drop and volume on the Dow is in decline then this is not a rosy picture. Had the Transports moved up with the Dow then we would have had confirmation of strength, but without that confirmation something is wrong with this relationship and that was why I wanted to see how we closed this week in particular. The Dow finished on a weekly doji which is this context is a red flag. In addition we are completing a similar wedge to the Transports prior to its drop so we have another red flag. Then we have CCI suggesting weaker prices to come giving a third red flag. If this was not an election year and if Obama was not the darling puppet that I consider him to be, I would see this as a straightforward set up. Technically the Transports can wiggle and cause a pause in the Dow but I'll be looking to take a short signal here and play the bounces again as before. The risk to the bulls is now high and low for the bears so I am becoming more bearish here and looking for a short signal.
Finally the S&P doesn't look as clever as the Dow as we are waiting for confirmation or rejection of this level. That means either the Dow is leading, and it might, or it is showing a false break, which seems more likely.
Been trying to follow your reads but I see lack of conviction in most of the reads. If up then down, sort of stuff yet when you come back to revisit what was posted most of the replies begin with "As I ....." Not to break your balls but a little more conviction would be more convincing to those reading. It's like every read leaves no room for error as you tend to cover all the bases, up and down. "We might break out but looks down" "Looks lower but could break out" "Anything can happen" Well we already know any of that is probable at any given time, Im here to get an edge and perhaps choose a side. Apologies but just something I had to get out of my chest.
Give me an example and I will clear that up. I keep saying I am long until I get a short signal. Right now I am very bearish but holding long looking for a short signal. I am very clear on my expectations and positions so if you don't think so let's clarify anything I said.